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New research shows that younger Australians are more disposed to accumulating debt than previous generations.
A survey by comparison website RateCity found that age 20 is the new average age for Australians to take out their first credit card – compared to 34 for those born before 1949.
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The survey also found that 42 per cent of Australians under 24 have between $10,000 and $30,000 of personal debt, not including a mortgage.
They are also four times more likely to get a weekly cash advance from their credit card compared to their parents’ generation.
According to the survey, 56 per cent of Australians under 35 have not had a $0 balance on their credit card in the last year and 63 per cent don’t know what interest rate they are paying.
RateCity chief executive Alex Parsons said the changing nature of money had helped drive the growth in credit appetite among young Australians.
“We’re becoming an increasingly cashless society and that is breeding new attitudes towards the disposable nature of money, which is increasing the ability to rack up debt,” he said.
“These are alarming new statistics and we think a number of factors are at play here, but regardless of the causes I’d urge young people to get in control of their money today to avoid a financial nightmare down the track. Starting life in your 20s with tens of thousands of dollars can be crippling.”
Strategies for winning Gen Y business will be revealed in greater detail in next month’s issue of The Adviser magazine.
